Texas Homestead Law Overview
State homestead protection laws help prevent people from becoming homeless in the event of a foreclosure or change in economic circumstances. In Texas, every family and every single adult person is entitled to a homestead exempt from seizure passed on the claims of creditors, except for a pre-existing mortgage or lien. Texas homestead law protects qualifying real property from forced sale by general creditors, and courts have interpreted the laws broadly to help accomplish their goals.
Determining Urban or Rural Homesteads in Texas
A homestead can be either urban property or rural property. An urban homestead may be a home or a place of business, or both. There is no limit to the value of urban or rural homesteads, only to their size. Rural homesteads are limited to 200 acres for a family and 100 acres for a single adult, including improvements on the property. An urban homestead is limited to ten acres with improvements, which must be in adjacent lots. Whether a homestead is rural or urban affects such issues as the amount of acreage subject to the homestead exemption and whether the property can qualify as a business homestead.
Texas property law says that a homestead is considered to be urban if the property is:
- Located within the physical or jurisdictional limits of a municipality or a within a planned subdivision or development; and
- Served by police and/or fire protection; and
- At least three of the following services are provided by a municipality or under contract to a municipality:
-Storm sewer; and/or
Determining Family or Single Adult Homesteads in Texas
The distinction between a family and adult homestead is also significant because Texas law provides for different acreage allowances for each: 100 acres for a single adult and 200 acres for a family. The courts have defined a "family" as a group of people having the social status of a family. Further, the head of the family must be legally or morally obligated to support at least one other family member, and there must be a corresponding dependence by the other family member for this support. As long as the obligation of support and dependency is shown, a number of different types of relationships can be considered a "family" including:
- An adult child and parent;
- A brother and sisters;
- A divorced parent and a minor child; and
- A widower with no dependent children.
The duty of support may be either a moral or legal duty. In the case of a minor child or an elderly person, the support does not to be strictly financial, but could be emotional instead. However, support of a dependent adult must always be financial.
There can only be one homestead per family. But in the event of divorce, each spouse may claim a separate homestead. If one spouse passes away, the surviving spouse may retain the family status.
Establishing Homesteads in Texas
Creating homestead rights in a piece of property in Texas does not require a formalized legal process or the filing of a specific document. Creating a homestead is typically based on how owners use the land and whether they intend to claim the land as a permanent residence. While you do not have to actually occupy the property, you do need the right to possession of the property. By the same token, occupying and using a piece of land alone doesn’t make it a homestead. Different types of usage of the property are required to establish urban and rural homesteads.
In order to establish a rural homestead, you must reside on the property and use all the remaining property to support your family. If you have a multi-parcel rural homestead, you only need to reside on one parcel. However, you must use the property as a permanent home. Occasional, weekend, or holiday use generally is not enough to claim the property as a rural homestead. At the same time, using the property for agricultural purposes, without residence, cannot establish a homestead. When it comes to using the remaining property for the support of your family, this use may include agricultural pursuits. But as long as you use the property as a home, you do not need to gain economic support from the use of the remaining property.
In order to establish an urban business homestead the head of the family must actually have a business, the land must be reasonably adapted and necessary to that business, and the property must actually be used as the place to conduct the business. As you can imagine, these kinds of determinations may depend heavily on the facts of each individual case.
Texas real estate laws can be complicated, and you may find it helpful to consult with an experienced Texas real estate attorney. You can also find more information on this topic in FindLaw’s homestead protections section.